Correlation Between Guosheng Financial and Youyou Foods
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By analyzing existing cross correlation between Guosheng Financial Holding and Youyou Foods Co, you can compare the effects of market volatilities on Guosheng Financial and Youyou Foods and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Guosheng Financial with a short position of Youyou Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guosheng Financial and Youyou Foods.
Diversification Opportunities for Guosheng Financial and Youyou Foods
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guosheng and Youyou is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Guosheng Financial Holding and Youyou Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youyou Foods and Guosheng Financial is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Guosheng Financial Holding are associated (or correlated) with Youyou Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Youyou Foods has no effect on the direction of Guosheng Financial i.e., Guosheng Financial and Youyou Foods go up and down completely randomly.
Pair Corralation between Guosheng Financial and Youyou Foods
Assuming the 90 days trading horizon Guosheng Financial Holding is expected to generate 1.19 times more return on investment than Youyou Foods. However, Guosheng Financial is 1.19 times more volatile than Youyou Foods Co. It trades about 0.03 of its potential returns per unit of risk. Youyou Foods Co is currently generating about 0.03 per unit of risk. If you would invest 824.00 in Guosheng Financial Holding on August 25, 2024 and sell it today you would earn a total of 276.00 from holding Guosheng Financial Holding or generate 33.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guosheng Financial Holding vs. Youyou Foods Co
Performance |
| Timeline |
| Guosheng Financial |
| Youyou Foods |
Guosheng Financial and Youyou Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guosheng Financial and Youyou Foods
The main advantage of trading using opposite Guosheng Financial and Youyou Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guosheng Financial position performs unexpectedly, Youyou Foods can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Youyou Foods will offset losses from the drop in Youyou Foods' long position.| Guosheng Financial vs. BeiGene | Guosheng Financial vs. Kweichow Moutai Co | Guosheng Financial vs. Beijing Roborock Technology | Guosheng Financial vs. G bits Network Technology |
| Youyou Foods vs. Hubeiyichang Transportation Group | Youyou Foods vs. Jiujiang Shanshui Technology | Youyou Foods vs. Fujian Longzhou Transportation | Youyou Foods vs. Dazhong Transportation Group |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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